Scrap faulty property tax: Watchdog

A coalition of citizens’ organisations has planned a protest later this week to demand the scrapping of the new property tax system, which they say is irrational and flawed.

The coalition of some 40 organisations that is fighting this issue under the banner of ‘The Watchdog’, wants the new tax system revoked entirely, and a new formula worked out in consultation with all stakeholders across the city.

“The new property tax formula prepared by the Brihanmumbai Municipal Corporation (BMC) is faulty and not acceptable to us. The civic body did not bother to consult the citizens before preparing this formula,” said advocate Godfrey Pimenta, president of the Sahar Citizens Forum.
He explained that under the Jawaharlal Nehru National Urban Renewal Mission, it is mandatory that the civic body consult citizens while preparing the tax formula.

Sahar Citizens Forum is one of the organisations in the alliance which also has the Mumbai Gaothan Panchayat, Perry Road Residents Association, ALM 144 in Khar, Marol Citizens Forum and the Bombay Catholic Sabha. The date of the protest will be announced after permission is received from the police and other authorities.

Residents of over 3.5 lakh buildings across the city have been affected by the new charges and many have even refused to pay the amount. BS Vader, director and a former chairman of the Mumbai Housing Federation, said, “We have asked all 35,000 housing  societies to pay the bill as per the old system. So, the civic body can’t take any legal action against them.”

The new tax system is based on the capital value of the property and uses the ready reckoner to compute this value. This is a shift from the previous system that was based on the rental or rateable value.

The system was approved by the body of elected civic representatives in June and introduced in January with retrospective effect from 2010-11. Therefore, while the charges have gone up
considerably, property owners have been burdened with huge arrears.

Pimenta pointed out that while it is mandatory that transactions for flats are done on the basis of the carpet area, the BMC has decided to charge property tax on the built-up area. “This is illogical,” he said.

Neil Pereira, a Khar resident, said, “It is irrational to calculate the capital value of the property on the basis of the ready reckoner that is used for paying stamp duty which is calculated on the basis of the locality and does not consider the condition of individual buildings. This means that the BMC has rationalised area-wise property tax and individually.”

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